Chip Eng Seng crunched by collapse in apartment investors at Fishermans Bend

Financial returns lodged with the Singapore sharemarket show overall sales to date in Chip Eng Seng’s signature Melbourne project at 15-85 Gladstone Street are running at 5.9 per cent, equivalent to just 13 apartments.

“Demand for Melbourne residential dwelling remained soft, with fewer apartments sold for the first phase,” the group said.

Sales were “not expected to improve significantly” in the first quarter this year.

Anecdotal evidence from other developers, both local and offshore, suggests Chip Eng Seng’s experience is not unique.

The full development of FIFTEEN85 in the suburb’s Montague precinct includes another two similar-sized towers.

By contrast, Malaysian developer UEM Sunrise managed to sell 95 per cent of its massive 940-apartment Aurora Melbourne Central project within two weeks of launch, during the sector’s boom four years ago.

Last week UEM topped out construction of the 92-storey project in La Trobe Street, which includes an additional 252 serviced apartments that it sold to Ascendas Hospitality Trust.

Incentives offered to Chip Eng Seng’s buyers in Fishermans Bend included free blinds throughout apartments, $10,000 in furniture and white goods vouchers, up to $7000 towards audio-visual and smart-home gadgets, and a year without owner corporation fees.

The developer also offered to match the $10,000 first home owners’ grant for eligible buyers.

Sales of Chip Eng Seng’s 64 Willow Apartments in Doncaster, in the city’s eastern suburbs, have fared better – 83 per cent of its units have found buyers.

A weaker Australian dollar also led to currency losses on the group’s foreign assets, it said.

Other developers have turned their hand to Fishermans Bend. Last week, Spec Property submitted revised plans for its site at 272 Normanby Road, with at least 8 per cent of the 307 apartments given over to affordable housing.

Property Editor at The Age and BusinessDay journalist for Fairfax’s,, and

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